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Marketing Management - Chapter 1

Defining marketing

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0% found this document useful (0 votes)
14 views46 pages

Marketing Management - Chapter 1

Defining marketing

Uploaded by

Sadia Zerin
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Marketing Management

A South Asian Perspective

Philip Kotler; Kevin Lane Keller;


Abraham Koshy and Mithileswar
Jha

13th Edition
1
Marketing Management
Defining Marketing for the 21st
Century

Chapter # 1

2
What is Marketing?

The American Marketing Association offers the following


formal definition:

Marketing is an organizational function and a set


of processes for creating, communicating, and
delivering value to customers and for managing
customer relationships in ways that benefit the
organization and its stakeholders.

3
What is Marketing?

Social Definition that serves our purpose:

Marketing is a social and managerial process by which


individuals and groups obtain what they need and want
through creating, offering and freely exchanging products
and services of value with others.

4
What is Marketing Management?

Marketing Management is the art and science of


choosing target markets and getting, keeping, and
growing customers through creating, delivering, and
communicating superior customer value.

5
Core Marketing Concepts

Needs, Wants &


Demands

Markets Products &


Services

Exchange, Transactions Value, Satisfaction &


& Relationships Quality
6
What are Consumer’s Needs, Wants and
Demands?

 Needs - state of felt deprivation for basic items such as


food and clothing and complex needs such as for
belonging. i.e. I am hungry.
 Wants - form that a human need takes as shaped by
culture and individual personality.
i.e. I want a burger, French fries, and a soft drink.
 Demands - human wants backed by buying power.
i.e. I have money to buy this meal.

7
5 Types of Needs
 Stated Needs – the customer wants an inexpensive car
 Real Needs – the customer wants a car whose
operating cost, nor its initial price is
low.
 Unstated Needs – the customer expects good service
from the dealer.
 Delight Needs – the customer would like the dealer to
include an onboard navigation
system.
8  Secret Needs – the customer wants friends to see him
Demand States

 Negative  Irregular
 Nonexistent  Full
 Latent  Overfull
 Declining  Unwholesome

9
Demand States

 Negative Demand
A major part of the market dislikes the product and
may even pay a price to avoid it—vaccinations, dental
work, blood donations and operations, for instance.
Marketer’s task is to analyze why is it happening and
needs to offer marketing programs like – product
redesign, lower prices and positive promotions that
can change the attitude. Make it into their likings, etc.

10
Demand States

 Nonexistent Demand
Target consumers may be unaware of or uninterested
in the product. Farmers may not be interested in a new
farming method, and college students may not be
interested in foreign-language courses.

Marketer’s task is to find ways to connect the benefits


of the product with the person’s natural needs and
interests.
11
Demand States

Latent Demand
Many consumers may share a strong need that cannot
be satisfied by any existing product.
E.g. Web portal for the Tourism Industry of
Bangladesh.

Marketer’s task is to measure the size of the potential


market and develop a product / service to fulfill this
need.

12
Demand States
Declining Demand
Consumers begin to buy the products less frequently or
not at all. Every organization faces declining demand for
one or more of its products or services.
E.g. Jet Washing powder in comparison to Surf Excel.
Robin Liquid Blue in comparison to Ujala.
The Marketer must analyze the reason for decline and
must find a way (which can be redesigning the product
or service or even offering a completely new product or
service) to reverse the declining demand.
13
Demand States
Irregular Demand
Consumers purchases vary on a seasonal, monthly,
weekly, daily or even hourly basis. Many organizations
face demand causing problems of idle or overworked
capacity. E.g. – Cold drinks companies, ice cream
manufacturers, Water Kingdom during the Winter
Season. Umbrella, Raincoats, etc.
Marketing task called as synchromarketing, is to find
ways to alter the pattern of demand through flexible
pricing, promotion, and other incentives.
14
Demand States
Full Demand
Consumers are adequately buying all products put in
the marketplace. Organization faces full demand when
they are pleased with their volume of business. E.g.
Cell phones – Nokia, Computer Accessories

Marketing task is to maintain the current level of


demand in the face of changing consumer preferences
and increasing competition. The organization must
maintain or improve quality and continually measure
consumer satisfaction.
15
Demand States
Overfull Demand
More consumers would like to buy the product that can
not be satisfied. Some organization face a demand
level that is higher than they can or want to handle.
Eg. University – Set up tough questions in the
admission exam, set up GPA benchmark, etc.

Marketing task called de-marketing (Which includes raising prices


or stopping sales promotion) is sometimes required for these
organizations. Selective de-marketing can also be done the aim of
which is to reduce demand for those parts of the market which are
less profitable or less in need of the product or service.

16
Demand States

Unwholesome Demand
Unwholesome products will attract organized efforts to
discourage their consumption. Un-selling campaigns
have been conducted against cigarettes, alcohol, hard
drugs, handguns and large families.

The marketing task is to get people who like


something to give up, using such tools as fear
message, price hikes, and reduced availability.

17
What is Marketed?

Goods Services Events

Experiences Persons
Places

Organizations Information Ideas

Properties
18
What is Marketed?

Goods
Service
s

Experien
19 Event ces
What is Marketed?
Mark Zuckerberg Bill Gates

Person Organizati
s ons

Place Informatio
20 s n
What is Marketed?

Idea
s
21
Properti
es
Customer Value and Satisfaction

Value Gained From Owning a Product and


Costs of Obtaining the Product is
Customer Value

Product’s Perceived Performance in Delivering


Value Relative to Buyer’s Expectations is
Customer Satisfaction

22
Exchange and Transaction

 Exchange is the core concept of


marketing, it is the process of obtaining
a desired product from someone by
offering something in return.
 A Transaction is a trade of values
between two or more parties.

23
Exchange and Transaction

 There are at least two parties.


 Each party has something that might be of value to the
other party.
 Each party is capable of communication and delivery.
 Each party is free to reject the exchange offer.
 Each party believes it is appropriate or desirable to deal
with the other party.

24
Who Purchases Products and Services?

Actual & Potential


People Who Buyers
Exhibit Need

Market – Buyers who share


a particular need or want that
Resources to
Exchange can be satisfied through
exchange or relationships.

Willingness to
Exchange
Sellers
25
A Simple Marketing System

26
Key Customer Markets

 Consumer Markets
 Business markets
 Global markets
 Nonprofit/Government markets

27
Key Customer Markets

 Consumer Markets
Companies selling mass consumer goods and services
such as soft drinks, cosmetics, air travel, athletic shoes
and equipments spend a great deal of time trying to
establish a superior brand image. Much of a brand’s
strength depends on developing a superior product and
packaging, ensuring its availability and backing it with
engaging communications and reliable service.

28
Key Customer Markets

 Business Markets
Companies selling business goods and services often
face well-trained and well-informed professional
buyers who are skilled at evaluating competitive
offerings. Business buyers buy goods in order to make
or resell a product to others at a profit.
Business marketers must demonstrate how their
products will help these buyers achieve higher revenue
or lower costs. Advertising can play a role, but the
sales force,
force price and the company’s reputation for
reliability and quality may play a stronger one.
29
Key Customer Markets
 Global Markets
Marketers must decide first which countries to enter, how to
enter each country (Export,
Export Licenser,
Licenser Joint venture partner,
partner
contract manufacturer,
manufacturer or solo manufacturer,
manufacturer etc.); how to
price their products in different countries; and how to adapt
their communications to fit different cultures.
They make decisions in the face of different requirements for
buying, negotiating, owning and disposing of property; different
culture, language, legal and political systems and currencies
that might fluctuate in value.

30
Key Customer Markets

 Nonprofit & Government Markets


Companies selling their goods to nonprofit organizations such
as mosques, churches, temples, charitable organizations, and
government agencies need to price carefully, because these
buyers have limited purchasing power.
Lower selling prices affect the features and the quality the
seller can build into the offering.
Much government purchasing calls for bids and the buyers
often favor the lowest bid in the absence of justifying factors.

31
Company (Marketing) Orientations

32
Company (Marketing) Orientations

 Production Concept
The Production Concept holds that the consumers will prefer
those products that are widely available and inexpensive.
- Managers of production-oriented businesses concentrate
on achieving high production efficiency, low costs and
mass distribution.
- Price of the products remains relatively low

33
Company (Marketing) Orientations

 Product Concept
The Product Concept holds that consumers will
prefer those products that offer the most quality,
performance and innovative features.
- Managers in these organizations focus on making
superior products and improving them over time.

34
Company (Marketing) Orientations

 Selling Concept
The Selling Concept holds that consumers, if left
alone will ordinarily not buy enough of the
organization’s products. The organization must
therefore undertake an aggressive selling and
promotion effort.

35
Company (Marketing) Orientations

 Marketing Concept
The Marketing Concept holds that the key to achieving
organizational goals consists in determining the needs
and wants of target markets and delivering the desired
satisfactions more effectively and efficiently than
competitors.

36
Company (Marketing) Orientations

 Societal Marketing Concept


The Marketing Concept holds that the key to
achieving organizational goals consists in
determining the needs and wants of target markets
and delivering the desired satisfactions more
effectively and efficiently than competitors in way
that preserves or enhances the consumer’s and the
society’s well being.

37
Company (Marketing) Orientations

Society
(Human Welfare)

Societal
Marketing
Concept
Customers Company
(Want Satisfaction) (Profits)
38
Company (Marketing) Orientations

39
The Holistic Marketing Concept

The Holistic Marketing Concept is based on


the development, design and implementation of
the marketing programs, processes and
activities that recognizes that “everything
matters” in marketing – and that a broad,
integrated perspective is often necessary.

40
The Holistic Marketing Concept

Marketing Senior Other Products &


Department Management Departments Communications Services Channels

Internal Integrated
Marketing Marketing
Holistic
Marketing

Performance Relationship
Marketing Marketing
Sales
Revenue
Ethics
Brand & customer equity
Environment Customers Channel Partners
41 Legal Community
The Four P Components
of the Marketing Mix

42
4 Ps 4Cs
 Product 
Customer Solution
 Price  Customer
Cost
 Place  Convenience
 Promotion 
43 Communication
Marketing Management Tasks

 Developing marketing strategies and plans


 Capturing marketing insights
 Connecting with customers
 Building strong brands
 Shaping market offerings
 Delivering value
 Communicating value
 Creating long-term growth

44
The New Marketing Realities

 Network Information Technology


 Globalization
 Deregulation
 Privatization
 Heightened Competition
 Industry Convergence
 Consumer Resistance
 Retail Transformation
45
END OF CHAPTER # 1

46

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